Research on Criteria for Operational Audit of Expenditure from State Budget in Vietnam

In Vietnam, operational audits have been upgraded as an independent form of audit in the operation of the supreme audit agency. However, because it was introduced later than other types of audit, it is still confusing and general in setting criteria of audit. There are no specific guidelines for auditing expenditure from state budget. Therefore, the formation and application of audit criteria in the audit practice of expenditure from state budget has not been effective, spontaneous and influenced by the actual capacity of assigned auditors. Meanwhile, in order to perform the proper audit function, the most important thing is to build up the evaluation criteria. Based on data collected both secondary and primary from interviewing auditors, experts in the field of state budget, we conducted the synthesis, analysis, evaluation, comparison and clarification of research issues. The results show that the formation of audit criteria is not really reasonable; criteria for economic efficiency and effectiveness are sometimes unclear. Therefore, this study is to identify and develop criteria for evaluating the operational audit of expenditure from state budget in Vietnam.

Diagram 1: The relationship between the principles of economy, efficiency and effectiveness Based on the above analysis, it is possible to generalize the approach of assessing the economy, efficiency, effectiveness when the operational audit is based on the process in the diagram 2.
Diagram 2: Approach model to assess the economy, efficiency and effectiveness when conducting operational audit

Research Methodology
This study focuses on studying criteria for evaluating operational audits for expenditures from the state budget in ministries carried out by the State Audit of Vietnam (SAV). This audit was carried out from 2015 to 2018 related to spending from the State Budget.
In which the qualitative research method to survey and explore audit criteria is combined with data collection methods such as (i) Collect data from documents, audit reports, field surveys and in-depth interviews with experts; (ii) Analyze and discuss survey results; and (iii) Discover and synthesize the criteria for auditing expenditure from the state budget.
Secondary data: statistically conduct case studies related to the article, point out new points in previous studies; collect and study the research results of domestic and foreign scientists related to the article, thereby determining the audit criteria.
Primary data: collect materials through methods such as sending survey questionnaires, direct interviews.
To implement the method, we has designed survey questionnaires including closed-type questions and openended questions to send to State audit leaders, leaders and auditors of the SAV at the audit departments of specialized audits II, III, general department, regime and quality control department, the legal department of SAV involved in the operational audit of spending from the state budget capital; Develop an open-ended Questionnaire to discuss directly with the SAV's leaders, directors and auditors at the audit departments of the Audit II, III; The Department of General Affairs, quality control department, Department of Legal Affairs of the SAV who have participated in the operational audit of spending from the state budget.
Develop open questionnaires to exchange directly with auditors at specialized audit departments II, III, and audit departments operating under the General Department.
Conducting interviews, direct exchanges of related subjects, interviewing policy experts, auditors. Consulting experts to clarify the research criteria, as a basis for giving more conclusive conclusions and orientations to build

Requirements and objectives
Operation Inputs auditing criteria for spending activities in the state budget in the coming time.

Results and Discussion
Results of audit report collection, in-depth interviews with executives and audit team leaders; we found that while conducting audits and evaluating operational efficiency at these units, auditors mainly use financial analysis indicators to describe and compare with previous fiscal years. This analysis and evaluation are not consistent and synchronous between the budget users.

Economy Criteria
The criteria of economy while conducting the operational audit of spending from the state budget capital are usually carried out by the auditors who compare the total expenditure estimates and the level of expenditures according to the settlements at the ministries and the spending levels according to the settlement of regular spending activities and development investment expenditures. Based on the estimated figures and settlement figures of the ministries and auditors conduct the table of assessment on the difference in the estimates and settlement of expenditures from the state budget and the difference will be evaluated.
In each ministry, with each specific activity, the auditor compares the cost savings of each specific activity by comparing the difference of actual expenditures against the approved estimates to determine the level of cost savings of each activity: regular spending and development investment expenditures.
However, the level of expenditure from the budget for each activity in the ministries is different, depending on the functions and tasks of the Ministry. Therefore, the criteria for assessing the economy of each ministry are different; Economy criteria are evaluated as economical when the performance target of that expenditure is lower than the plan and estimate. Based on the data of difference, the auditors concludes on the saving level of the operation, finding out the reason for this to have an appropriate audit recommendation.

Efficiency Criteria
Auditors evaluate the efficiency of budget spending through analyzing and assessing the structure of expenditure sources for budget spending activities in the ministry. At the same time, through determining the criteria below and assessing based on the achieved, partially achieved or not achieved criteria. However, the scale to assess the level of attainment, partial or unsuccessful achievement is still subjective of the auditors and the audit team but not yet sufficient. * Criteria for the auditors to assess the efficiency in using and managing expenditures from the state budget in the ministries -Are the classified expenditures from the state budget capital in the Ministries properly implemented for the right purpose? Has the content been properly regulated in the budget management decentralization yet? -Does the financial resources in the Ministry prioritize the needs or objectives of the Ministry in terms of financial tightening (reducing recurrent expenditures)? -Is there any limit on administrative costs, improving the autonomy of the subordinate to the lower-level estimating units, creating motivation to save costs by specific ways? -Does the service quality increase when the decision to spend in the direction of reducing regular expenditures (autonomy in some units of the Ministry, the administration of administrative costs, the reduction of civil servants.)? -Has the increased accountability of lower-level estimating units in the use of budget spending been implemented? * Criteria for auditors to evaluate the efficiency of the Ministry's budget spending process -Is the budget estimation (budget revenue and expenditure estimation) effective? -Does the budget comply with the budget plan? -Is the budget accounting honest and complete? Is the settlement data matching the documents? -Regarding accountability for budget activities, is the budget decisions made with responsibility?

Effectiveness Criteria
Effectiveness of spending activities from the Budget in the Ministries is reflected in the level of achieving the objectives in the expenditure activities of the unit. Through interviews, the auditors found out that this criteria is a very difficult to assess specifically; it can be divided into the following two groups of criteria: -Defining criteria: often reflected in the operational plan objectives or estimated in the ministry's work plan. Can auditors indicate spending activities, budget allocation, budget implementation with disbursement schedule? -Estimating criteria: predicting the impact of future performance results of spending activities if implemented according to capital plans. -Effectiveness is achieved when the Ministries strictly complies with the provisions of the State budget law, investment project items to ensure time schedule, contract conditions. -Has the Ministry developed and followed the steps of the budget process? -Do members perform the assigned functions properly? -Does the ministry implement the principles of control, assignment, division, assignment and authorization in budget spending activities? * Criteria that auditors use to evaluate the effectiveness of internal control -Does the ministry fulfill the objectives and plans related to the implementation of the Budget task? -Does the ministry implement the control principles such as assignment, authorization, approval in management activities? -Do the departments and members perform their assigned functions correctly? The results of audit shows the legal effect of regulations on State management on regular expenditures, especially investment in capital construction, capital management and other related regulations issued by the State agency, investors and stakeholders fully comply with the implementation process. However, there are some shortcomings that partly reduce the validity of promulgated legal documents.

Findings
Based on the survey data from 2014-2018 the operational audit of state budget spending in ministries implemented by the State Audit of Vietnam, the authors found out that: First, auditing criteria of the operational audit of spending from the state budget in the ministries have not been properly built. For the SAV, the operational audit is still a new concept and has no precedent, so the criteria have not been shaped, set up immediately when selecting the subject of auditing to orient and will definitely collect audit evidence to evaluate criteria; resulting in both working and adding criteria in the audit process, The constructed criteria are still primarily prognostic, qualitative has not much specific assessment in terms of quantitative.
Surveying and collecting information from the stage of selecting the auditing topic, the step of the audit planning step is not long enough, there is no effective support from the experts and the quality to establish criteria for evaluating economy, efficiency and effectiveness.
Some audit criteria have been established without consulting experts or opinions of audited units, leading to not fully understanding the operational objectives of the budget cycle, failing to correctly determine the audit objectives making the auditing criteria not yet close, not attached to the content according to 3Es and there are some cases where no agreement with the audited units and managing agencies are reached.
The results of auditing to assess the economy, efficiency, effectiveness of expenditures from the State budget have not met the requirements, not fully analyzed and evaluation of the criteria set in management, using resources, assessing the effectiveness of policies; The comments are general, no specific criteria for assessing each audit content; The quality of auditing has not satisfactorily answered the issues of efficiency of spending from the state budget, providing information to ministries and branches at all levels to improve the efficiency of decisions, supervision, management and regulation, Budget implementation, amending and supplementing more appropriate policy mechanisms.
Second, awareness, professional capacity and skills of Auditors in assessing the economy, efficiency and effectiveness are still limited in both theory and practical experience in setting appropriate auditing criteria due to this new type of audit conducted by the SAV. The auditors mainly use the skills of auditing financial statements, Compliance audit to make comments to evaluate the economy, efficiency and effectiveness of audits. On the other hand, the audit evaluating the economy, efficiency, effectiveness of management and use of state budget, public property of the State at the ministries is complicated due to difficult output of activities, programs and projects quantification and beyond economic efficiency are also socially effective.
Third, the department of performance audit has not actively informed the audited units about the main aspects of the audit, especially the audit criteria prior to the start of the data collection period and after completing an audit plan for coordination in the audit process and creating consensus on established audit criteria. Currently, only conferences are held to announce the audit decisions stating the objectives, the general content of the audit and the time period, the list of auditors performing the audit at the units.
Fourth, the determination of audit criteria to assess the economy, efficiency and effectiveness in expenditure from the state budget in auditing process in ministries is still widespread; while in the countries where the operational audit has developed, audit teams only choose 1-2 audit criteria to evaluate and comment. Basically, economy is the same as the efficiency, so sometimes there is no need to distinguish these two criteria and the efficiency criteria will decide, and affect the efficiency criteria.
The ambition to evaluate the whole economy, the effectiveness and efficiency of an audit is too vast considering both the theoretical and practical aspects of a particular audit, not necessarily trying by all means to conclusions on all three criteria of a management apparatus. The priority of any goal depends on the content of interest in the task of performing the function that the Ministry is undertaking, depending on the requirements of socio-economic development in each stage, as well as capacity and qualifications of Auditors Fifth, the implementation of the audit to assess the economy, efficiency and effectiveness of management and use of the budget in auditing expenditures from the State budget capital should build up criteria for each audit objective. In fact, the criteria for making assessments, comments on the economy, efficiency and effectiveness of the State budget spending activities over the past time are mainly subjective of the Auditors on the basis of evidence collected and based on analysis and evaluation on the unit's Budget reports. The preparation of an audit report on the content of "economy, efficiency, effectiveness in management and use of state budget, money and national property" according to the regulation form. However, the content still lacks a convincing basis, mainly assessing and analyzing on the basis of the unit's reporting information and the content of the assessment also repeats the contents of other items.

Recommendations for Improving Evaluation Criteria in Operational Audit
Based on summaries of previous studies and surveying audit practices of some developed countries in developing audit criteria assessment; we noticed that tt is difficult to develop a uniform set of criteria to apply to all audits, in addition to the common goal to assess the economy, effectiveness and efficiency of implementing the Government's Resolutions on State budget, each ministry and branch has its role, position, specific organization of activities, models, and various operational tasks. Therefore, constructed criteria should be directed to spending activities from the State's main state budget to achieve the objective of implementing functional tasks as prescribed, in order to create the initiative for auditors when applying these criteria.

Complete criteria for evaluating economy
Economy shows the level of saving of inputs and still achieves the unit's operational objectives. For ministries that need to achieve state management goals with as little expenditure as possible, they still ensure acceptable quality. Budget expenditure savings = Actual spending amount -expenditure approved on cost estimate Saving amount <= 0 saved financial resources compared to estimates. Number of saving> 0 wasted financial resources compared to the plan. However, the assessment of savings depends on expanding the scale of operation, improving the quality of services, changing financial mechanisms and meeting the implementation of specialized functions of the ministry. In order to develop the audit criteria, it is necessary to determine the purpose of use and the management of the financial resources of the unit. For ministerial-level administrative agencies, financial management is aimed at balancing spending needs and meeting the performance of assigned functions and tasks effectively. a, Proposing criteria for economy calculation according to budget spending activities at the Ministry Auditors will provide information on the costs of regular spending and development investment, including: -Regular spending includes Expenses for education and training; Spending for health and population; Expenses for Science and Technology; Economic career expenses; Expenditure for environmental protection; Administrative management expenditure -Expenses for development investment include Expenses for evaluation and approval of total cost estimates; Expenditure for investment bidding; Expenses for investment implementation; Expenses for examination and approval of investment settlement. Therefore, auditors compares these contents on the aspects: actual implementation, approved estimates and 1. Auditing aims 2. Auditing criteria 6. Observation / conclusion explanation of the reasons for differences, explaining the reasons for differences to make conclusions and audit recommendations. b, Proposing a scale to assess the economy in spending activities from the state budget according to specific spending activities at the ministry, include: -Directing the management of saving practice and reducing wastefulness (maximum score is 10).
-Specific results of saving total recurrent expenditure (except for wage and salary items) (maximum score is 40).
-Results of thrift practice and waste combat of the estimating units under the maximum scale of 40).
-Savings, inspection and waste prevention activities (maximum score is 10). And then, auditors gave actual scores on these contents and explained the reasons for difference to make conclusions and audit recommendations.

Complete criteria for evaluating effectiveness
For the ministries, the efficiency of the total expenditure from the state budget needs to reach the available cost to achieve the higher the better. In addition, the goal is not only in relation to resource costs (financial, human resources...) but also in relation to social efficiency. a, Criteria for assessing economic efficiency (in term of money) It is the difference or comparative ratio between the total economic value obtained at the output (economic value brought about by the development investment expenditure) at the time of evaluation to determine the efficiency with the total input cost (multiplied by force, funding, materials, vehicle depreciation and facilities, energy, etc.). The formula is:

Economic efficiency = Total value, economic benefits obtained -Total costs (public spending for development investment)
If the total value of economic benefits is much greater than the investment spent, the economic efficiency is higher. Based on the budget expenditure operation model, the auditors create a table to assess the effectiveness of spending from the state budget according to the output results to assess the economic and social efficiency of spending activities. Assessing the efficiency of spending from the state budget according to the output depends on the functions and tasks of each ministry, to create output products, results and investment spending efficiency accordingly.

Completing criteria for evaluating effectiveness
Effectiveness shows the level of achieving the objectives in the operation of the unit. Evaluating the accomplishment of an activity goal. Thus, for the typical budget expenditure audit, it is necessary to develop the criteria for evaluating the effectiveness as follows: a, Develop criteria to evaluate the effectiveness of managing the budget expenditure activities of the ministry on the evaluation contents. It includes Skills of budget estimation; Budget estimation process; Implementing techniques for budget estimation; Skills of budget settlement; Organize meetings to implement budget activities. Based on that the auditors compare these contents on the following aspects: actual performance, assigned targets and explaining the causes of differences, explaining the reasons for difference to make conclusions and audit recommendations. b, Develop criteria for evaluating the effectiveness of issuing policies and legal documents related to the Ministry's budget on the following contents: The process of developing legal documents of the Ministry of finance and investment as prescribed; Obtaining opinions of estimating units under draft legal documents; The promulgated legal documents have met the practical needs and objectives of budget management at the Ministry. And then, the auditors compare these contents on the following aspects: actual implementation, assigned targets and explain the causes for differences, explain the reasons for differences to make conclusions and audit recommendations. c, Develop criteria for auditing the effectiveness of operational management to increase operational efficiency by the following criteria: Rate of cost optimization of operations; Rate of completion of spending from the state budget; Progress of putting key investment projects into operation. d, Develop criteria for evaluating the effectiveness of accountability of the Ministries on budget spending. Accountability is one of the requirements of good administration. Agencies and public employees must be accountable for their activities. Accountability is not only done with higher levels but also with external audiences (organizations, citizens, businesses) when they use public services created by the ministry, provided and responsible for the consequences of the unit. Criteria for accountability of budget spending need to assess the following activities: Explain to the authorities about law enforcement, comply with regulations issued by superiors; Explain to the legislative bodies the implementation of the functions and duties assigned; Ability to answer questions and inquiries for use of administrative services; Respond to mass media agencies on issues related to their public responsibility.